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Overview <br /> <br />Agenda Subject: 3rd Quarter 2016 Financial Report Date: November 18, 2016 Department: Finance Attachments: Quarterly Financial Report Budget Impact: $0 Administrative Recommendation: <br />For discussion only. Background Summary: The quarterly financial report summarizes the general state of Citywide financial affairs and highlights significant items or trends that the <br />City Council should be aware of. The attachment provides the third quarter 2016 status report based on financial data available as of October 28, 2016 for the period ending September <br />30, 2016 and sales tax information representing business activity that occurred through July 2016. Staff: Coleman Meeting Date: November 28, 2016 Item Number: 1 <br />General Fund Summary Property TaxesSales TaxesOther TaxesIntergovernmental(Grants, etc.)DevelopmentService FeesCulture &RecreationOther Fees& ChargesOtherRevenuesPersonnelSupplies& ServicesIntergovernmentalOther <br />ExpendituresRevenuesExpenditures$0$5$10$15$20$25$30MillionsYTDBudgetYTDActuals(Favorable)YTDActuals(Unfavorable)Year-To-DateGeneral Fund Revenues and Expenditures(Through Q3-2016)$41.7$50.0$45.0$46.8TotalRevenuesTotalExpenditures$0$10$20$30$40$50$60MillionsCouncil& <br />MayorAdministrativeServicesCommunity &Human ServicesMunicipal Court& ProbationHumanResourcesFinanceCity AttorneyCommunityDevelopmentJail -SCOREPolicePublic WorksParks, Arts& RecreationStreetsNon-Departmental$0$5$10$15$20MillionsYTDBudgetYTDActuals(Favorable)YTDActuals(Unfavorable)Year-To-DateGeneral <br />Fund Expenditures by Department(Through Q3-2016) 2 <br />September 2016 Financial ReportGeneral Fund2015Summary of Sources and UsesAnnualBudgetYTD BudgetYTD ActualYTD ActualAmountOperating RevenuesProperty Tax517,733,500$ 9,763,600$ 9,920,666$ <br />9,500,023$ 157,066$ 1.6 %Sales Tax614,572,000 10,793,100 11,036,028 10,850,092 242,928 2.3 %Sales Tax -Annexation Credit1,912,000 1,411,100 1,500,373 1,469,642 89,273 6.3 %Criminal Justice <br />Sales Tax1,747,000 1,288,300 1,454,287 1,341,552 165,987 12.9 %Brokered Natural Gas Tax282,000 226,500 177,005 195,126 (49,495) (21.9)%City Utilities Tax83,521,200 2,618,300 2,901,188 <br />2,712,038 282,888 10.8 %Admissions Tax333,600 257,800 269,321 278,210 11,521 4.5 %Electric Tax83,297,700 2,511,200 2,733,513 2,393,107 222,313 8.9 %Natural Gas Tax8852,000 754,800 833,093 <br />878,683 78,293 10.4 %Cable TV Franchise Fee9906,700 678,500 728,136 689,428 49,636 7.3 %Cable TV Franchise Fee -Capital64,000 48,000 49,877 53,921 1,877 3.9 %Telephone Tax81,620,000 <br />1,233,600 1,144,823 1,271,170 (88,777) (7.2)%Garbage Tax (external)8106,000 79,470 92,985 84,177 13,515 17.0 %Leasehold Excise Tax33,000 23,200 191,475 45,968 168,275 725.3 %Gambling <br />Excise Tax334,400 276,800 403,771 147,986 126,971 45.9 %Taxes sub-total47,315,100$ 31,964,270$ 33,436,540$ 31,911,123$ 1,472,270$ 4.6 %Business License Fees11221,000$ 127,700$ 106,657$ <br />154,096$ (21,044)$ (16.5)%Building Permits101,190,000 938,800 1,432,215 977,631 493,415 52.6 %Other Licenses & Permits533,600 382,200 582,773 434,921 200,573 52.5 %Intergovernmental <br />(Grants, etc.)125,627,893 4,073,903 4,179,792 3,929,887 105,889 2.6 %Charges for Services:General Government Services1367,200 49,300 61,991 60,462 12,691 25.7 %Public Safety13520,300 <br />395,678 453,345 396,978 57,666 14.6 %Development Services Fees14680,600 501,600 794,082 933,627 292,482 58.3 %Culture and Recreation152,105,080 1,810,600 2,076,505 2,030,266 265,905 <br />14.7 %Fines and Forfeits16796,180 613,000 696,072 711,380 83,072 13.6 %Fees/Charges/Fines sub-total11,741,853$ 8,892,781$ 10,383,431$ 9,629,247$ 1,490,650$ 16.8 %Interest and Other Earnings1735,200$ <br />26,000$ 81,161$ 32,834$ 55,161$ 212.2 %Rents, Leases and Concessions17630,600 508,600 645,327 574,287 136,727 26.9 %Contributions and Donations1732,000 25,100 26,883 31,947 1,783 7.1 <br />%Other Miscellaneous17157,800 117,900 228,553 159,007 110,653 93.9 %Transfers In220,926 139,000 139,112 76,000 112 0.1 %Insurance Recoveries -Capital & Operating25,000 18,743 58,094 <br />131,404 39,352 210.0 %Other Revenues sub-total1,101,526$ 835,343$ 1,179,131$ 1,005,479$ 343,789$ 41.2 %Total Operating Revenues60,158,479$ 41,692,393$ 44,999,102$ 42,545,850$ 3,306,709$ <br />7.9 %Operating ExpendituresCouncil & Mayor1,085,833$ 810,500$ 802,274$ 662,611$ 8,226$ 1.0 %Administration 1,350,722 1,013,400 831,249 746,156 182,151 18.0 %Community & Human Services1,329,547 <br />819,200 577,608 644,041 241,592 29.5 %Municipal Court & Probation2,355,889 1,974,000 1,892,377 1,888,511 81,623 4.1 %Human Resources1,406,554 1,016,200 930,960 793,308 85,240 8.4 %Finance1,300,773 <br />1,029,500 898,832 975,764 130,668 12.7 %City Attorney2,194,830 1,568,500 1,410,070 1,370,421 158,430 10.1 %Community Development4,731,841 3,507,500 3,014,962 2,868,071 492,538 14.0 %Jail <br />-SCORE5,583,542 3,485,746 3,014,605 2,744,147 471,141 13.5 %Police23,794,252 17,687,100 17,490,649 16,388,842 196,451 1.1 %Public Works2,809,335 2,090,900 2,262,105 1,975,023 (171,205) <br />(8.2)%Parks, Arts & Recreation11,584,205 8,768,200 8,627,328 8,320,497 140,872 1.6 %Streets3,466,563 2,389,100 2,256,727 2,044,555 132,373 5.5 %Non-Departmental5,539,627 3,862,413 2,783,240 <br />4,145,992 1,079,173 27.9 %Total Operating Expenditures68,533,514$ 50,022,259$ 46,792,985$ 45,567,941$ 3,229,273$ 6.5 %PageRef20162016 YTD Budget vs. ActualFavorable (Unfavorable)Percentage <br />3 <br />Executive Summary This Executive Summary provides an overview of the City’s overall financial position for the fiscal period ending September 30, 2016, reflecting financial data available <br />as of October 28, 2016. Through September 2016, General Fund revenues totaled $45.0 million compared to a budget of $41.7 million, and were $2.5 million higher than the revenues collected <br />during the same period in 2015. Some notable variances to budget year-to-date include: • Property tax collections through Q3-2016 totaled $9.9 million, which is 1.6% or $157,000 above <br />budget expectations and exceed collections in the same period last year by $421,000, or 4.4%. The majority of property tax revenues are collected during the months of April and October, <br />coinciding with the due dates for the County property tax billings. [page 5] • General Fund retail sales tax revenues totaled $11.0 million, exceeding budget by 2.3% or $243,000, and <br />exceeding 2015 collections by $186,000. The primary area of significant increase in sales activity compared to 2015 was the services category. [page 6] Collections in criminal justice <br />sales tax revenues exceeded budget by $166,000, or 12.9%. • The Other Taxes category performed better than budget through Q3-2016. City utility tax revenues exceeded budget by $283,000 <br />or 10.8%, predominately due to higher than budgeted capital system development revenues collected in the Water, Sewer and Storm funds. Electric and natural gas tax revenues collected <br />through September exceeded budget by $222,000 and $78,000, respectively. These revenues were somewhat offset by an unfavorable variance in telephone tax collections of $89,000. [page <br />8] Year-to-date collections of leasehold excise taxes were $168,000 favorable to budget due to an unbudgeted payment for the Emerald Downs property which is tribally owned. Gambling <br />excise tax revenues exceeded budget by $127,000 primarily due to the timing of payments: the City’s main remitter of card game taxes paid 6 months worth of taxes from 2015 in the current <br />year. • Building permit revenue through Q3-2016 exceeded budget by $493,000, and already exceeds year-end budget expectations. This was predominately due to a higher than anticipated <br />volume of building permits as well as multiple large commercial building permits issued. [page 10] • Other licenses and permit revenues exceeded budget expectations by $201,000 primarily <br />due to higher than anticipated revenue collected for plumbing permits. This increase in revenues was a result of increased construction activity within the City. One project in particular <br />that contributed to this influx of revenue is the permitting for the Promenade Apartment Project on 312th Street. • Development services fees revenues collected year-to-date exceeded <br />budget expectations by $292,000, or 58.3%. This is predominately due to higher than anticipated revenues collected for plan check services related to multiple single family and commercial <br />construction projects within the City. [page 14] 4 <br />• Culture and recreation revenues exceeded year-to-date budget by $266,000, and exceeded revenues collected the same period in 2015 by $46,000, or 2.3%. Revenue sources that were significantly <br />above budget include golf course and special events revenues. [page 15] • Year-to-date rents, leases and concession revenues were $137,000 or 26.9% above budget, and were $71,000 more <br />than collected the same period in 2015. This favorable variance is attributed to higher than anticipated revenues collected for City owned facility rentals and parking lot fees. [page <br />17] General Fund expenditures through the third quarter of 2016 totaled $46.8 million compared to a budget of $50.0 million, representing a 6.5% favorable variance to budget. All departments <br />operated within their allocated budget through Q3-2016 with the exception of the Public Works department. This department is running over budget YTD through September by $171,000, or <br />8.2%. The variance to budget is seen in salary and benefit expenditures, as project engineers are charging more of their time to general fund projects versus transportation and utility <br />projects. Year-to-date through September General Fund expenditures are $1.2 million, or 2.7%, higher than the same period last year. Salary and benefit costs increased by $1.4 million, <br />or 5.7% compared to the same period in 2015. This year-over-year increase is due primarily to an increase in Council approved FTEs (Full Time Equivalents) and increased costs associated <br />with healthcare and pension benefits. In addition, charges for services paid to Valley Communications for 911 services have increased year-over-year by $406,000, or 20.0%. These increased <br />expenditures were somewhat offset by a reduction in intergovernmental expenditures by $915,000 as compared to the same period in 2015. $41.7 M $50.0 M $45.0 M $46.8 M $0.0$10.0$20.0$30.0$40.0$50.0$60.0RevenuesExpenditures$ <br />MillionsGeneral Fund 2016 Revenues vs. Expenditures2016 YTD Actual2016 YTD Budget 5 <br />Revenues The combined total of property, sales/use, utility, gambling, and admissions taxes provides approximately 80% of all resources supporting general governmental activities. The <br />